FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
UNITED STATES OF AMERICA, No. 06-50580
Plaintiff-Appellee,
v. D.C. No.
CR-03-00025-AHS
JAMES DAVIS BENNETT,
OPINION
Defendant-Appellant.
Appeal from the United States District Court
for the Central District of California
Alicemarie H. Stotler, Senior District Judge, Presiding
Argued and Submitted
February 1, 2010—Pasadena, California
Filed September 10, 2010
Before: Andrew J. Kleinfeld, Kim McLane Wardlaw and
Consuelo M. Callahan, Circuit Judges.
Opinion by Judge Wardlaw;
Dissent by Judge Callahan
13915
13918 UNITED STATES v. BENNETT
COUNSEL
Phillip A. Trevino of the Law Offices of Phillip Trevino (Los
Angeles, California) for the appellant.
George S. Cardona, Robb C. Adkins, and Brett A. Sagel of
the Office of the United States Attorney’s Office (Santa Ana,
California) and Curtis Kin of the United States Attorney’s
Office (Los Angeles, California) for the appellee.
OPINION
WARDLAW, Circuit Judge:
It is a federal crime knowingly to execute, or attempt to
execute, a scheme or artifice “(1) to defraud a financial insti-
tution; or (2) to obtain any of the moneys, funds, credits,
assets, securities, or other property owned by, or under the
custody or control of, a financial institution, by means of false
or fraudulent pretenses, representations, or promises.” 18
U.S.C. § 1344. “Financial institution” is defined, as relevant
to this appeal, as any bank or savings association the deposits
of which are insured by the Federal Deposit Insurance Corpo-
ration (“FDIC”). See 18 U.S.C. § 20(1); 12 U.S.C.
§ 1813(c)(2). James Bennett challenges the sufficiency of the
evidence supporting his convictions on three counts of a
twelve-count superseding indictment charging him with bank
fraud under § 1344. These three counts arise from mortgages
that Bennett fraudulently procured from Equicredit Corpora-
tion, a wholly-owned subsidiary of Bank of America
(“BOA”). Although Equicredit is not a “financial institution,”
BOA is. We must decide whether, viewing the evidence in the
light most favorable to the prosecution, any rational juror
could have found beyond a reasonable doubt that Bennett pro-
cured funds “owned by” a “financial institution.”
UNITED STATES v. BENNETT 13919
I. BACKGROUND
James Bennett — a mortgage broker, real estate appraiser,
and escrow agent — operated a sophisticated property flip-
ping scheme in Southern California. “A fraudulent property
flip is a scheme in which individuals, businesses, and/or straw
borrowers buy and sell properties among themselves to artifi-
cially inflate the value of the property.” Fed. Fin. Inst. Exami-
nation Council, The Detection and Deterrence of Mortgage
Fraud Against Financial Institutions 36 (Apr. 2010) (“FFIEC
Report”). A Federal Bureau of Investigation report explains:
Property flipping is best described as purchasing
properties and artificially inflating their value
through false appraisals. The artificially valued prop-
erties are then repurchased several times for a higher
price by associates of the “flipper.” After three or
four sham sales, the properties are foreclosed on by
victim lenders. Often flipped properties are ulti-
mately repurchased for 50 to 100 percent of their
original value.
Financial Crimes Section, F.B.I., Financial Crimes Report to
the Public (FY 2007). “This scheme is designed to extract as
much cash as possible from the property, and the loan pro-
ceeds are often used for purposes not stated on the applica-
tion.” FFIEC Report at 36.
Bennett identified multi-unit buildings that were listed for
sale in low-income neighborhoods in Los Angeles and Long
Beach. He provided his family members with cash to pur-
chase the properties at their listed market price. He then iden-
tified “straw purchasers” to repurchase the same properties
from his family members at drastically inflated prices. Some-
times, the straw purchasers were Bennett’s associates or fam-
ily members, and at other times, they were unwitting
participants who were lured into the transactions by lucrative
13920 UNITED STATES v. BENNETT
incentives, such as cash rebates and zero-money-down mort-
gages.
Bennett facilitated the sale of the properties from the initial
buyers to the straw purchasers. He began by appraising the
properties at 30% to 50% above their fair market value. Then,
acting as the mortgage broker, he helped the straw purchasers
obtain mortgages in the amounts of the inflated property val-
ues. The documents that he submitted to various lending insti-
tutions to acquire the mortgages were replete with
misrepresentations about the properties and the borrowers.
Not only did he inflate the appraised value of the properties,
but he also misrepresented their potential rental income and
fabricated grant deeds and title reports to conceal his family
members’ involvement with the properties. He also submitted
false information about the borrowers’ employment statuses
and incomes so that they would qualify for mortgages that
otherwise would be denied. Finally, acting as the escrow
agent, Bennett used falsified copies of cashier’s checks and
deposit forms to represent that deposits had been made to
escrow accounts, when, in fact, they had not.
Bennett ensnared several lending institutions in his web of
lies. Provided with false information about the properties and
borrowers, these institutions were duped into issuing mort-
gages to the straw purchasers. Bennett profited in an amount
equal to the difference between the mortgage proceeds fraud-
ulently obtained from the lender and the amount paid in cash
to acquire the property at its market price. Meanwhile, many
of the straw purchasers defaulted on their mortgages, typically
within months of the transaction, leaving the lenders to fore-
close on the properties at a loss.
Equicredit was one of Bennett’s victims. Three undisputed
facts about Equicredit are central to Bennett’s appeal. First,
Equicredit is not a “financial institution” within the meaning
of the bank fraud statute. The government did not introduce
evidence that Equicredit was FDIC-insured or otherwise met
UNITED STATES v. BENNETT 13921
the statutory definition of “financial institution,” nor does the
government argue that Equicredit is a “financial institution”
on appeal. Second, Equicredit was, at all relevant times, a
wholly-owned subsidiary of BOA. Christine Costamagna, a
BOA vice president and assistant corporate secretary, and
Milton Chadwick, a BOA attorney, testified that BOA owned
all Equicredit stock at all times relevant to the charges against
Bennett. The government also introduced corporate docu-
ments establishing that Equicredit was BOA’s wholly-owned
subsidiary. Third, BOA is a “financial institution” because it
is FDIC-insured. The government introduced a certificate of
BOA’s FDIC insurance coverage, and Bennett does not dis-
pute that BOA is a “financial institution.” In January 2003, a
federal grand jury returned an indictment against Bennett and
several of his associates for “execut[ing] a scheme to defraud
mortgage lenders and to obtain money and property by means
of materially false and fraudulent pretenses, representations,
and promises.” In September 2005, the grand jury returned a
superseding twelve-count indictment against Bennett only.
The indictment charged Bennett with four counts of wire
fraud under 18 U.S.C. §§ 2(b) and 1343 and seven counts of
bank fraud under 18 U.S.C. § 1344. Each of the wire fraud
and bank fraud counts involved a different mortgage for a dif-
ferent property in Southern California. The twelfth count of
the superseding indictment charged Bennett with operating a
continuing financial crimes enterprise in violation of 18
U.S.C. § 225.
In January 2006, a jury convicted Bennett on all twelve
counts. Bennett moved for judgment of acquittal, which was
granted as to the twelfth count because the government failed
to introduce evidence that Bennett received $5 million or
more from the enterprise, as required by statute. See 18
U.S.C. § 225(a)(2). The district court denied Bennett’s motion
for judgment of acquittal as to all other counts.
Bennett appeals only his convictions as to counts eight
through ten, which charged him with bank fraud arising out
13922 UNITED STATES v. BENNETT
of mortgages obtained from Equicredit on three different
properties in Long Beach; Bennett does not contest his con-
victions or sentence on counts one through seven or count
eleven. The sole issue raised on appeal is whether the govern-
ment presented sufficient evidence from which any rational
juror could find beyond a reasonable doubt that the “financial
institution” element of the bank fraud statute was satisfied in
circumstances where the fraudulently obtained mortgages
were loaned by Equicredit, a wholly-owned subsidiary of a
“financial institution.”
II. JURISDICTION AND STANDARD OF REVIEW
The district court exercised jurisdiction pursuant to 18
U.S.C. § 3231, and we have jurisdiction over a final judgment
pursuant to 28 U.S.C. § 1291. We review de novo a claim
challenging the sufficiency of the evidence supporting an ele-
ment of an offense. See United States v. Sullivan, 522 F.3d
967, 974 (9th Cir. 2008). A claim of insufficient evidence
fails if “after viewing the evidence in the light most favorable
to the prosecution, any rational trier of fact could have found
the essential elements of the crime beyond a reasonable
doubt.” Jackson v. Virginia, 443 U.S. 307, 319 (1979). Under
Jackson, “[w]e begin by viewing the evidence produced at
trial in the light most favorable to the prosecution.” United
States v. Nevils, 598 F.3d 1158, 1169 (9th Cir. 2010) (en
banc). Then, “[m]oving to the second step of Jackson, we
must consider whether the evidence, as construed above, is
sufficient to allow any rational juror to conclude that the gov-
ernment has carried its burden of proof.” Id.
III. DISCUSSION
[1] Enacted as part of the Comprehensive Crime Control
Act of 1984, Pub. L. No. 98-473, Title II, § 1108(a), the fed-
eral bank fraud statute makes it a federal crime knowingly to
execute, or attempt to execute, a scheme or artifice “(1) to
defraud a financial institution; or (2) to obtain any of the mon-
UNITED STATES v. BENNETT 13923
eys, funds, credits, assets, securities, or other property owned
by, or under the custody or control of, a financial institution,
by means of false or fraudulent pretenses, representations, or
promises.” 18 U.S.C. § 1344. The statute is “designed to pro-
vide an effective vehicle for the prosecution of frauds in
which the victims are financial institutions.” S. Rep. No. 98-
225, at 377 (1983). “Financial institution” is defined to
include any bank or savings association the deposits of which
are insured by the FDIC. See 18 U.S.C. § 20(1) (cross-
referencing the definition of “insured depository institution”
in 12 U.S.C. § 1813(c)(2)). By criminalizing frauds perpe-
trated against FDIC-insured banks, the statute furthers “[the]
strong federal interest in protecting the financial integrity of
these institutions.” S. Rep. No. 98-225, at 377.
[2] The government concedes that Bennett’s fraud was
perpetrated against Equicredit and that Equicredit does not
meet the statutory definition of “financial institution.” There-
fore, the government does not argue that § 1344(1) applies
(i.e., that Bennett “defraud[ed] a financial institution”).
Instead, it argues that Bennett fraudulently obtained funds
“owned by” a financial institution for purposes of § 1344(2).
The government contends that, as a matter of law, a parent
corporation “owns” the assets of its wholly-owned subsidiary,
and therefore that Bennett fraudulently obtained assets
“owned by” BOA, a financial institution, when he obtained
mortgages from Equicredit.1
More than a century of corporate law says otherwise. See,
e.g., Wells v. Dane, 63 A. 324, 325 (Me. 1905) (“The plaintiff
was not the corporation, notwithstanding he owned and con-
trolled a majority of its stock. He did not own or control its
property . . . .”); Huber v. Martin, 105 N.W. 1031, 1037 (Wis.
1
When pressed at oral argument, the government insisted repeatedly that
the government was proceeding only under the “ownership” aspect of
§ 1344(2), and it disavowed any contention that Bennett’s conviction
might be upheld under the “custody or control” aspect of § 1344(2).
13924 UNITED STATES v. BENNETT
1906) (“Where is the ownership of the net assets of a mutual
insurance company located? That the legal title is in the cor-
poration goes without saying.”). As early as 1926, the
Supreme Court recognized that “[t]he owner of the shares of
stock in a company is not the owner of the corporation’s prop-
erty.” R.I. Hosp. Trust Co. v. Doughton, 270 U.S. 69, 81
(1926). While the shareholder has a right to share in corporate
dividends, “he does not own the corporate property.” Id.
This principle was followed by the states as corporate law
developed. In 1941, the California Supreme Court declared
that it was “fundamental, of course, that the corporation has
a personality distinct from that of its shareholders, and that
the latter neither own the corporate property nor the corporate
earnings.” Miller v. McColgan, 110 P.2d 419, 421 (Cal.
1941). In 1959, the Delaware Supreme Court rejected an
argument — much like that presented here — that a parent
corporation owns its wholly-owned subsidiary’s assets. See
Buechner v. Farbenfabriken Bayer AG, 154 A.2d 684, 686
(Del. 1959). In affirming the denial of the plaintiff’s motion
to seize the property of the defendant corporation’s wholly-
owned subsidiary, the Buechner court explained that the par-
ent company “has no interest of any specific assets of the
[wholly-owned subsidiary]” because “[t]he corporation is an
entity, distinct from its stockholders even if the subsidiary’s
stock is wholly owned by one person or corporation.” Id. at
686-87; see also Finley v. Kanter, 53 So. 2d 347, 349-50 (Ala.
1950) (“A corporation is a distinct legal entity, separate and
distinct from its shareholders and officers, and the property
representing the capital of the corporation is vested in and
owned by the corporation. This general doctrine is well estab-
lished and obtains both at law and in equity.”); Am. State
Bank v. Jones, 239 N.W. 144, 146 (Minn. 1931) (“It is diffi-
cult to see how the taking over of the property of the bank
deprives [the shareholder] of any property. He had no title to,
or right to the possession of, any property owned by the
bank.”).
UNITED STATES v. BENNETT 13925
[3] Today, it almost goes without saying that a parent cor-
poration does not own the assets of its wholly-owned subsid-
iary by virtue of that relationship alone. As the Supreme
Court explained in more recent years:
A basic tenet of American corporate law is that the
corporation and its shareholders are distinct entities.
An individual shareholder, by virtue of his owner-
ship of shares, does not own the corporation’s assets
. . . . A corporate parent which owns the shares of a
subsidiary does not, for that reason alone, own or
have legal title to the assets of the subsidiary.
Dole Food Co. v. Patrickson, 538 U.S. 468, 474-75 (2003)
(citations omitted); see also United States v. Bestfoods, 524
U.S. 51, 61 (1998) (“It is a general principle of corporate law
deeply ingrained in our economic and legal systems that a
parent corporation (so-called because of control through own-
ership of another corporation’s stock) is not liable for the acts
of its subsidiaries.” (internal quotation marks omitted)); 1
William Meade Fletcher, Fletcher Cyclopedia of the Law of
Corporations § 31 (2006) (“The property of the corporation is
its property and not that of the shareholders as owners. . . .
That is to say, the capital or assets of the corporation are its
property, and the shares evidenced by the stock certificates
are the property of the shareholders, which do not carry the
capital property or any profits until they have been declared
and vested as dividends. . . . A holding corporation does not
own the subsidiary’s property.”); 18A Am. Jur. 2d Corpora-
tions § 632 (“Even complete ownership of all outstanding
stock of a corporation is not the equivalent of ownership of
a subsidiary’s property or assets, because a parent and subsid-
iary comprise two wholly separate entities with individual
property rights, no transfer of title to corporate property tak-
ing place.”); 15 Cal. Jur. 3d Corporations § 335 (“The share-
holders are not the owners of corporate property.”).
We have applied this fundamental precept of corporate law
in various contexts. For instance, in Katzir’s Floor & Home
13926 UNITED STATES v. BENNETT
Design, Inc. v. M-MLS.com, 394 F.3d 1143 (9th Cir. 2004),
we concluded that the district court abused its discretion when
it amended a judgment entered against a defunct corporation
to include the corporation’s sole shareholder. Katzir’s Floor
& Home Design, 394 F.3d at 1149. We explained that the sole
shareholder and the subsidiary corporation were distinct enti-
ties, so the liabilities of the former could not be imputed to the
latter absent a showing that the corporate form had been
abused. See id. (“The mere fact of sole ownership and control
does not eviscerate the separate corporate identity that is the
foundation of corporate law.”). Similarly, in Doe v. Unocal
Corp., 248 F.3d 915 (9th Cir. 2001), we rejected an attempt
to obtain jurisdiction over a parent corporation by virtue of its
subsidiaries’ activities, noting that “the fact that [the parent]
indirectly owns or holds the stock of [the subsidiaries] does
not, without more, convert these two corporations into general
agents for [the parent] for jurisdictional purposes.” Unocal,
248 F.3d at 930; see also id. at 925 (“The existence of a rela-
tionship between a parent company and its subsidiaries is not
sufficient to establish personal jurisdiction over the parent on
the basis of the subsidiaries’ minimum contacts with the
forum.”); Int’l Bhd. of Teamsters, Local 952 v. Am. Delivery
Serv. Co., 50 F.3d 770, 775 (9th Cir. 1995) (noting, in the
labor context, that “[a] subsidiary should be considered a sep-
arate entity so long as it is not under the ‘actual or construc-
tive control’ of its parent”).
[4] We see no reason to set aside fundamental principles of
corporate law in the context of the federal bank fraud statute,
particularly where Congress provided no indication that we
should do so. See Miles v. Apex Marine Corp., 498 U.S. 19,
32 (1990) (“We assume that Congress is aware of existing law
when it passes legislation.”). In fact, rather than instructing us
to ignore corporate law principles by considering FDIC-
insured banks and their subsidiaries as one and the same,
Congress has taken alternative measures to expand the reach
of the bank fraud statute. In May 2009, Congress amended the
definition of “financial institution” to include mortgage lend-
UNITED STATES v. BENNETT 13927
ing businesses. See Fraud Enforcement and Recovery Act of
2009, Pub. L. No. 111-21, § 2(a)(3). Had this amendment
been in effect at the time of Bennett’s criminal activity, Ben-
nett’s bank fraud convictions involving Equicredit undoubt-
edly would stand.
[5] Here, the government presented evidence that Bennett
fraudulently procured funds from Equicredit; that Equicredit
was a wholly-owned subsidiary of BOA; and that BOA was
a “financial institution” because it was FDIC-insured. We
hold that, based on these facts and the governing law at the
time of the offense, no rational trier of fact could have found
that Bennett procured assets “owned by” a financial institu-
tion.
Urging us to conclude otherwise, the government asks us
to reject a century’s worth of corporate jurisprudence and
instead follow a thirty-year-old opinion from the Fifth Circuit
Court of Appeals. See United States v. Cartwright, 632 F.2d
1290 (5th Cir. 1980). In Cartwright, the Fifth Circuit con-
cluded that a subsidiary’s assets “belonged to” a parent corpo-
ration for purposes of 18 U.S.C. § 657, which made it a crime
to misapply funds belonging to a financial institution. Cart-
wright, 632 F.2d at 1292. The Cartwright court acknowledged
that it “is perhaps true that under principles of corporations
law the assets of a wholly-owned subsidiary do not ‘belong’
to the sole shareholder in a legal sense.” Id. It nonetheless
concluded that the subsidiary’s assets “belonged to” the par-
ent for purposes of § 657 because “it is difficult to assail the
argument that depleting the assets of a wholly-owned subsid-
iary reduces the value of the subsidiary’s stock and thus
directly diminishes the assets of the parent.” Id.; see also
United States v. White, 882 F.2d 250, 253 (7th Cir. 1989)
(acknowledging that “[a] wholly owned subsidiary is, by defi-
nition, wholly owned by its parent, so it is natural to attribute
its assets to the parent”).
We find Cartwright unpersuasive. First, the Cartwright
court did not explain why “principles of corporations law”
13928 UNITED STATES v. BENNETT
should be cast aside in the context of the statute it was apply-
ing. Second, the Cartwright court failed to appreciate the dis-
tinction between the act of misapplying funds belonging to a
financial institution and the act of diminishing the value of a
financial institution’s assets. Though both actions might be
objectionable, Congress only criminalized the former. We
must be mindful of the precise language Congress used to
describe the illegal conduct. Unlike other statutes, the bank
fraud statute does not make it a crime “to devalue” a financial
institution’s assets or “to affect” a financial institution. See,
e.g., United States v. Bouyea, 152 F.3d 192, 195 (2d Cir.
1998) (finding that the jury could conclude that wire fraud
against a wholly-owned subsidiary “affects” the parent corpo-
ration); United States v. Pelullo, 964 F.2d 193, 215-16 (3d
Cir. 1992) (same). Instead, the bank fraud statute makes it a
crime fraudulently “to obtain” assets “owned by” a financial
institution. Because no rational trier of fact could conclude
that the assets Bennett fraudulently procured from Equicredit
were “owned by” BOA, sufficient evidence does not support
Bennett’s conviction on that basis.
The government does not argue that BOA had “custody or
control” of Equicredit’s funds under § 1344(2) — indeed, at
oral argument, the government stated that the record would
not support such a finding. The dissent nevertheless maintains
that a rational juror could find “custody or control” based on
the undisputed fact that Equicredit was wholly owned by
BOA. While the dissent properly asserts that, in the suffi-
ciency analysis, all evidence in the record should be consid-
ered in the light most favorable to the prosecution, see
Jackson, 443 U.S. at 319, we agree with the government that
no rational juror could conclude that BOA had custody or
control of Equicredit from the evidence adduced at trial.2
2
Because the terms “custody” and “control” are not defined in the bank
fraud statute, we “construe [them] according to [their] ordinary, contem-
porary, common meaning[s].” See United States v. W.R. Grace, 504 F.3d
745, 755 (9th Cir. 2007). In ordinary usage, to have “custody” over a thing
UNITED STATES v. BENNETT 13929
[6] Under the sufficiency of the evidence inquiry,
“[c]ircumstantial evidence and inferences drawn from it may
be sufficient to sustain a conviction,” but “mere suspicion or
speculation cannot be the basis for creation of logical infer-
ences.” Walters v. Maass, 45 F.3d 1355, 1358 (9th Cir. 1994)
(quoting United States v. Lewis, 787 F.2d 1318, 1323 (9th
Cir.), amended on denial of reh’g, 798 F.2d 1250 (9th Cir.
1986), cert. denied, 489 U.S. 1032 (1989)). The government
introduced no evidence regarding the relationship between
BOA and Equicredit, and the record contains nothing from
which the jury could discern the nature, amount, or even exis-
tence of any control exercised by BOA. Though we can spec-
ulate — as opposed to draw a reasonable inference — that
BOA may have been involved in Equicredit’s business or
decisionmaking, see, e.g., United States v. Edelkind, 467 F.3d
791 (1st Cir. 2006); In re W. States Wholesale Natural Gas
Litig., 605 F. Supp. 2d 1118 (D. Nev. 2009), or may have
funded the loans Equicredit issued, see, e.g., United States v.
Chandler, 66 F.3d 1460 (8th Cir. 1995); United States v.
Brandon, 17 F.3d 409 (1st Cir. 1994), BOA may just as plau-
sibly have been an absent corporate parent, exercising no con-
trol over Equicredit at all, see, e.g., Jenkins v. Union Corp.,
999 F. Supp. 1120 (N.D. Ill. 1998).
[7] Because the government relied solely on Equicredit’s
status as a wholly-owned subsidiary, and presented no evi-
dence indicating what kind of parent-subsidiary relationship
actually existed, any inference drawn from Equicredit’s
wholly-owned subsidiary status would be impermissible spec-
is to have it in one’s “keeping; guardianship; [or] care.” Webster’s College
Dictionary 335 (Random House 1991); see also Webster’s New Collegiate
Dictionary 318 (9th ed. 1983) (defining “custody” as the “immediate
charge and control . . . exercised by a person or an authority”). To “con-
trol” a thing is “to exercise restraint or direction over; dominate, regulate,
or command.” Webster’s College Dictionary 297 (Random House 1991);
see also Webster’s New Collegiate Dictionary 285 (9th ed. 1983) (defin-
ing “control” as the “power or authority to guide or manage”).
13930 UNITED STATES v. BENNETT
ulation. That status, standing alone, provides no basis from
which to infer control beyond a reasonable doubt given the
endless variety of parent-subsidiary relationships that can
accompany it. See White, 882 F.2d at 253 (refusing to draw
inferences about a parent-subsidiary relationship based on
wholly-owned subsidiary status alone). Thus, the fact that
BOA owns all of Equicredit’s shares does not indicate cus-
tody or control, and no rational juror could so find on that
basis. Because the government presented no evidence show-
ing that the assets Bennett obtained were under BOA’s “cus-
tody or control,” sufficient evidence does not support
Bennett’s conviction of the three counts at issue.
CONCLUSION
[8] Given that the government does not argue that Bennett
defrauded a financial institution, and that no rational juror
could find beyond a reasonable doubt that the funds at issue
were “owned by, or under the custody or control of” a finan-
cial institution in the circumstances presented here, Bennett’s
conviction and sentence for counts eight through ten must be
vacated. We remand for proceedings consistent with this
opinion.
VACATED and REMANDED.
CALLAHAN, Circuit Judge, dissenting:
I dissent from the majority’s holding that James Davis Ben-
nett’s (“Bennett”) conviction on counts eight through ten of
his twelve-count indictment must be vacated because, viewed
in the best light for the prosecution, there was insufficient evi-
dence to support his conviction on those counts. I would
affirm.
First, I agree with the majority that the applicable standard
of review is the two-step standard articulated in Jackson v.
UNITED STATES v. BENNETT 13931
Virginia, 443 U.S. 307, 319 (1979), in which viewing the evi-
dence in the light most favorable to the prosecution, we then
consider whether any rational juror could conclude that the
government met its burden of proof.
Here, there is no doubt that Bennett committed the mort-
gage fraud that he has been convicted of, the only question is
whether, viewed in the best light for the prosecution, there
was sufficient evidence for any rational juror to conclude that
the mortgage fraud Bennett committed against Equicredit
Corporation (“Equicredit”), which is a wholly-owned subsid-
iary of Bank of America (“BoA”), was against a “financial
institution” within the meaning of 18 U.S.C. § 1344.1 Under
§ 1344, it is a federal crime to knowingly execute, or attempt
to execute, a scheme or artifice “(1) to defraud a financial
institution; or (2) to obtain any of the moneys, funds, credits,
assets, securities, or other property owned by, or under the
custody or control of, a financial institution, by means of false
or fraudulent pretenses, representations, or promises.”
I would find that there was sufficient evidence in the record
for a rational juror to find that Bennett obtained property from
Equicredit under the “custody or control” of BoA even if BoA
did not actually exercise actual control over Equicredit. Spe-
cifically, at trial evidence was presented that the parent, BoA,
owned 100 percent of the shares of its subsidiary, Equicredit.
Viewed in the light most favorable for the prosecution, a
rational juror could conclude that this evidence supported the
conclusion that, as sole shareholder, BoA had the authority to
exercise some level of control over Equicredit. Therefore, by
defrauding Equicredit, Bennett was defrauding the financial
institution BoA, which had the right to “custody or control”
over its subsidiary within the meaning of § 1344. I would
therefore affirm.
1
A “financial institution” is defined as any bank or savings association
the deposits of which are insured by the Federal Deposit Insurance Corpo-
ration. See 18 U.S.C. § 20(1); 12 U.S.C. § 1813(c)(2).